The ‘No Frills’ Airline concept is not a phenomenon of the last couple of years in the Airline industry even if the recent development of these carriers in Europe might lead to this conclusion. The first Airline operating under the ‘No Frills’ concept started in the beginning of the 1970ies in the USA and it took quite a while until this concept was followed by Airlines in Europe, South America and Asia/Pacific. There were a lot of ‘No Frills’ Airlines coming and going again in the last 33 years. To start an Airline and define it as a ‘No Frills’ carrier seems to be not enough to be successful in the market for a lot of years. Only a very restricted number of these Airlines were successful and profitable for years. The question is why. What are the reasons why some ‘No Frills’ Airlines are surviving and others do not. This is one of the questions which will be answered in this paper.
The low cost and low price strategy which is the basis for the ‘No Frills’ concept in the Airline Industry is a business concept which was described by Porter as one of the basic strategies a company can follow. This strategy was followed by a lot of companies in other industries like ALDI, IKEA and Toyota. These companies followed successfully the cost leadership strategy but adopted also other strategic goals to their business concept like quality and corporate culture items. The cost leadership strategy is nothing new but how can it be reached and maintained in the Airline industry? What are the prerequisites and the required activities to be successful in this industry with this concept? In this paper answers to these questions will be given.
Table of Contents
- 1. Introduction
- 2. The development of the 'No Frills' Airlines from the 1970ies until now
- 3.1. Pioneers and Followers in the USA
- 3.2. The development in Europe
- 3.3. The beginnings in South America
- 3.4. The development in Asia / Pacific
- 3.5. The first efforts between continents
- 3.6. Summary
- 4. Analysis of the success factors of 'No Frills' Airlines
- 4.1. Network
- 4.2. Operation
- 4.3. Fleet
- 4.4. Sales and Pricing
- 4.5. Customers and Competitors
- 4.6. Corporate Culture and Human Resource Management
- 4.7. Summary
- 4.8. Checklist for Airline Start-Ups in the 'No Frills' business
- 5. Applicability of the 'No Frills' concept to specific Airline Businesses
- 5.1. A 'No Frills' intercontinental Economy Class business model
- 5.2. A 'No Frills' intercontinental Business Class business model
- 5.3. Further fields for research
- 6. Summary
Objectives and Key Themes
This thesis aims to analyze the success factors of "No Frills" airlines and assess the applicability of this business model to intercontinental flights, both in economy and business class. The study traces the historical development of the "No Frills" concept across various geographical regions.
- Historical Development of No-Frills Airlines
- Key Success Factors of No-Frills Airlines
- Applicability of the No-Frills Model to Intercontinental Flights
- Comparative Analysis of Economy and Business Class Models
- Future Research Directions
Chapter Summaries
1. Introduction: This chapter introduces the "No Frills" airline concept, defining its core characteristics and setting the stage for the subsequent analysis of its development and success factors. It lays the groundwork for understanding the unique aspects of this business model in the context of the broader airline industry.
2. The development of the 'No Frills' Airlines from the 1970ies until now: This chapter provides a historical overview of the emergence and global expansion of "No Frills" airlines. It examines the evolution of the concept from its pioneering stages in the USA to its subsequent adoption and adaptation in Europe, South America, Asia, and across international routes. The chapter highlights key milestones, significant players, and regional variations in the development of this disruptive business model.
3. Analysis of the success factors of 'No Frills' Airlines: This chapter delves into a detailed analysis of the key elements contributing to the success of "No Frills" airlines. It examines critical areas such as network strategy (hub-and-spoke versus point-to-point), operational efficiency, fleet management, pricing and revenue management, customer segmentation and competitive positioning, and corporate culture and human resource management. The chapter explores the interdependencies between these factors and their collective impact on the overall success of the business model.
4. Applicability of the 'No Frills' concept to specific Airline Businesses: This chapter focuses on the feasibility of extending the "No Frills" concept to intercontinental flights, examining both economy and business class applications. For each class, the chapter systematically evaluates the applicability of the key success factors identified in the previous chapter, considering potential challenges and adaptations required for this different operational environment. This evaluation helps to assess the potential market viability and profitability of such ventures.
Keywords
No Frills Airlines, Low-Cost Carriers, Airline Business Model, Network Strategy, Operational Efficiency, Fleet Management, Pricing Strategy, Customer Segmentation, Intercontinental Flights, Economy Class, Business Class, Historical Analysis, Comparative Analysis.
Frequently Asked Questions: Analysis of the Success Factors of "No Frills" Airlines and Their Applicability to Intercontinental Flights
What is the main focus of this document?
This document analyzes the success factors of "No Frills" airlines and assesses the feasibility of applying this business model to intercontinental flights, considering both economy and business class. It also traces the historical development of the "No Frills" concept globally.
What topics are covered in the document's Table of Contents?
The document includes an introduction, a historical overview of "No Frills" airline development across different regions (USA, Europe, South America, Asia/Pacific), an analysis of the success factors (network, operations, fleet, sales, customers, corporate culture), an examination of the "No Frills" concept's applicability to intercontinental economy and business class flights, and a concluding summary.
What are the key objectives and themes explored?
The key objectives are to analyze the success factors of "No Frills" airlines and determine the applicability of this model to intercontinental flights. Key themes include the historical development of "No Frills" airlines, their key success factors, the comparative analysis of economy and business class "No Frills" models for intercontinental flights, and future research directions.
What are the key success factors of "No Frills" airlines as discussed in the document?
The document analyzes several key success factors, including network strategy (hub-and-spoke vs. point-to-point), operational efficiency, fleet management, pricing and revenue management, customer segmentation and competitive positioning, and corporate culture and human resource management.
How does the document address the applicability of the "No Frills" model to intercontinental flights?
The document specifically examines the feasibility of extending the "No Frills" model to both economy and business class intercontinental flights. It evaluates the applicability of the key success factors identified in the context of long-haul flights and considers potential challenges and adaptations necessary for this different operational environment.
What is the historical scope of the document's analysis?
The historical analysis of "No Frills" airlines covers their development from the 1970s to the present day, tracing their emergence and expansion in various geographical regions.
What kind of comparative analysis is included?
The document includes a comparative analysis of the applicability of the "No Frills" model to both economy and business class intercontinental flights, evaluating the potential viability and profitability of each.
What are the keywords associated with this document?
Keywords include: No Frills Airlines, Low-Cost Carriers, Airline Business Model, Network Strategy, Operational Efficiency, Fleet Management, Pricing Strategy, Customer Segmentation, Intercontinental Flights, Economy Class, Business Class, Historical Analysis, Comparative Analysis.
What are the chapter summaries provided in the document?
The document provides summaries for each chapter, outlining the content and focus of each section. These summaries provide a concise overview of the information presented in each chapter.
What are the future research directions suggested?
While specific suggestions aren't detailed, the document implies further research could explore areas like the detailed financial modeling of "No Frills" intercontinental operations, specific regional market analyses for the "No Frills" model, and investigations into customer behavior and preferences concerning "No Frills" long-haul flights.
- Quote paper
- Sven Brueninghaus (Author), 2004, Applying the 'No Frills' concept to other specific Airline Businesses, Munich, GRIN Verlag, https://www.grin.com/document/23446
